Counties, cities spared from ‘haircut’ bill

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CHARLES TOWN – While cities and counties were successful in their efforts to remove cuts to money they receive from gambling taxes from Gov. Earl Ray Tomblin’s “haircut” bill, the legislation will still result in significant reductions to certain state programs.

House Bill 4333 passed the House of Delegates Feb. 26 by a vote of 72 to 25, with three members not voting after the House Finance Committee rewrote the bill to remove all cuts to local government.

All of Jefferson County’s delegates voted against the bill, which has been referred to the Senate Finance Committee, where it has yet to be taken up or put on an agenda.

Nonetheless, horsemen remain concerned about the bill, which is set to cut a variety of subsidies for horse racing, including purses awarded to race winners, though by less than the original bill would have.

Funding to state programs that derive from gambling taxes, including a fund to improve the Capitol’s Dome, will be cut entirely.

Racing subsidies will be cut 10 percent. Subsidies to the casinos themselves will be cut 10 percent, but subsidies to their employee pensions and benefits will not be cut.

As originally drafted, the bill would have cut 15 percent from the distribution counties and municipalities receive from video lottery and table gaming revenue at a time when this revenue has fallen sharply at Hollywood Casino – the most lucrative casino in the state – due to new competition in Maryland.

Penn National Gaming told stock analysts in its most recent earnings call that it expects revenue to continue falling there as more competition is brought online.

Reducing county and municipal distributions by 15 percent would have amounted to a total cut of some $4.3 million throughout the state.

Local governments are currently projected by the Lottery Commission to receive some $28.6 million from gambling taxes in the coming fiscal year.

There will be no cuts to the portion of funds sent to the state’s general revenue or worker’s compensation fund. State promotional funds will be cut 10 percent.

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